The Hastings Economic Development and Redevelopment Authority gave a one-year extension to a developer for the purchase of a downtown property at 317 E. 3 rd St. at its meeting Thursday night.
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The Hastings Economic Development and Redevelopment Authority gave a one-year extension to a developer for the purchase of a downtown property at 317 E. 3rd St. at its meeting Thursday night.
Luke Siewert, owner of River City Investments, LLC intends to build a 32-unit market rate apartment building on the site, which is now a parking lot. An adjacent home that River City Investments has already purchased will be torn down as part of the project.
HEDRA initially signed a contract with River City Investments in June 2021, and has approved two prior extensions with Siewert as he works to finance and put the project together.
Community Development Director John Hinzman said Siewert intends to rebid the project to get more favorable costs.
“The developer has completed the architectural plans, civic engineering plans, soil tests, landscape design, energy design, surveying and preliminary title work. The properties are ready for demolition and work as soon as the Purchase Agreement can be executed. Unfortunately, the bids came back unfavorably, and the developer intends to rebid the project late fall/early winter for construction to begin in early spring 2024. The current development contract required that the Developer close on the property by August 1, 2023. It is not in the best interest of HEDRA to relinquish control of the property until construction of the apartment project is imminent,” said Hinzman
The new closing date is on or before Aug. 1, 2024.
Hinzman said without the home Siewert purchased, HEDRA couldn’t really market its lot to another developer.
“The HEDRA-owned parcel to be acquired by the developer is not a viable redevelopment site on its own, and as such, staff is not concerned with tying up the property for an extended period of time while the developer works to rebid the project in an effort to reduce cost,” said Hinzman.
Siewert told HEDRA members that the August 2024 closing would be worst case scenario. Hinzman said it’s worth it to be patient on the project because it will help spur other redevelopment in the area.
“This would kind of set the tone for further development in the area,” he said. “No one’s knocking on the door on the property. We don’t expect anyone to be knocking on the door.”
Siewert said prices came in 35 percent higher than he expected.
“The plans are all ready to go,” he said. “I kind of had to step back at that moment. I wish I had better news for you that the project was moving forward.”
He believes the project will get better pricing this fall.
“The construction costs have come down. We’re hoping when we go to next year, the costs and labor will come down significantly,” Siewert said.
HEDRA and Hastings City Councilmember Jen Fox said Siewert’s request was reasonable.
“I value the investment Mr. Siewert has made in this project,” she said.
Siewert is hopeful for spring 2024 construction.
“My goal would be as soon as the ground thaws to get it going,” he said.
